A 2-STAGE ECONOMETRIC-ANALYSIS OF THE HOUSING EXTENSION DECISION IN KUMASI, GHANA

Much empirical work has been undertaken on housing production, investm ent Levels and on the changes necessary to increase the supply of hous ing at a national level, The implicit assumption in these perspectives , that owners buy and sell housing as an adjustment process, is not re alised in all housing markets around the world, In fact, in a number o f developing countries houses are seldom bought or sold: one such coun try is Ghana, Here traditional economic perspectives on modelling an o wner's decision to extend by comparing it with his decision to sell an d move are largely irrelevant, This paper seeks to make a contribution to the analysis of housing supply by developing a housing extension m odel for the Asante culture in Ghana, The model is evaluated in a two- step econometric analysis of the decision to extend, In the first stag e the probability of extending is modelled as a function of household characteristics, while the second stage predicts the amount spent on t he extension.